Ops Eye Big Digital-Cable Penetration

5/14/2000 8:00 PM Eastern

New Orleans-Cable operators remain bullish on their plans to aggressively deploy digital cable over the next several years, with some predicting that digital-basic penetration could easily exceed 50 percent within the next five years.

"Our plan is to drive digital as deeply as we can," Comcast Cable Communications Inc. president Steve Burke said at a National Show panel here last Monday about transitioning to digital.

As the technology improves and the MSO is able to offer new interactive services, he added, "Ultimately, 50 percent [digital] penetration would be a low number in five years."

"It's probable that we could get deeper," Time Warner Cable senior executive vice president Tom Rutledge agreed. "This is the first time in 20 years we've had truck-chasers."

Insight Communications Co. Inc. president Michael Willner also believes that digital penetration could exceed 50 percent in three to five years. He noted that new customers in Rockford, Ill.; Columbus, Ohio; and Evansville, Ind., take digital, rather than analog, at a rate of two-to-one.

Willner said advanced digital services, including video-on-demand and interactive television, have not only slowed subscriber churn to the direct-broadcast satellite competition, but also brought back customers who had previously left for DBS.

For similar competitive reasons, Comcast hopes to speed the deployment of its high-speed-data service this year. Churn for Comcast@Home customers is virtually nonexistent, Burke said.

The company hopes to lock as many of its customers into the high-speed cable-modem service as it can before digital-subscriber-line services are more widely deployed.

AT & T Broadband senior vice president of interactive television Richard Fickle predicted that digital set-top boxes incorporating Web devices could eventually be given away free-of-charge to customers in exchange for advertising and electronic-commerce relationships.

Cox Communications Inc. is marketing bundled digital video, voice and data services in a number of its systems. Senior vice president of operations Patrick Esser said it's a continuing challenge to recruit and retain the talent needed to deploy all three services.

Cox also plans a single-bill option for voice, video and data, Esser said, adding that today's cable-billing systems are not well prepared for telephony.

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